Gold June Future contract finished the week on a strong momentum, breaking its $1750 "Maginot Line", up by 2.5%.We should continue to see investors piling up the yellow metal as a plethora of persistent dark clouds remain positive for Gold .
The Spread between the Spot and the June 2020 Gold contract has been trading at a $13.30oz premium over Gold spot contract @ $1,743 on Friday, Slightly higher than the prior week.
According to the latest COT report, bullion banks keep trimming their short exposure, cutting another 3,103 contracts this week.
Hedge fund, CTA have decreased their long exposure by 7,176 contracts…
4 biggest players were short 178,826 Contracts (36% of OI)
We have demystified the COT report (exhibit 2)into an easier version to digest for our readers. Instead of 5 categories you will find 3 categories only.
- We combine the “producer” and “swap dealer” into one category Commercials AKA the bullion banks
- Managed money and other reportable AKA Hedge fund, CTA
- Non reportable AKA smaller traders without significant influence on market price.
Negative real yields show Bond Traders' growth worries deepening, which might be another supportive factor for Gold.